Ex-Covington official admits embezzlement

Former Covington Finance Director Bob Due enters Kenton Circuit Court on Thursday where he pleaded guilty to several charges related to the embezzlement of almost $800,000 from the city. In exchange for the plea, the Commonwealth's Attorney's Office recommended a total of 15 years in prison. Judge Gregory Bartlett set sentencing for April.(Photo: The Enquirer/Patrick Reddy)Buy Photo

There is no evidence former Covington Finance Director Bob Due was addicted to sex, drugs or gambling. Investigators can't find any fancy sports cars, beachfront villas or offshore bank accounts in his name.

It appears Due spent much of about $793,000 of taxpayer money he embezzled to help pay for the care of an ailing aunt and his childrens' tuition to private universities, prosecutors said after Due pleaded guilty to a 15-count indictment Thursday in Kenton Circuit Court.

"I think one reason he got away with it for so long was he didn't live a lavish lifestyle," Kenton Commonwealth's Attorney Rob Sanders said. "A lot of the money went to pay average, run-of-the-mill expenses that many people have."

Due made no public statements at his hearing but his attorney, Tim Schneider, said there wasn't anything salacious about how his client spent the stolen loot.

"If you look at what the money was spent on, it is pretty boring stuff," Schneider said. "No drugs, guns, gambling or girls - nothing that was exciting, for a lack of better words."

He said Due cooperated with investigators.

"He is sick to his stomach for what he has done," Schneider said. "He is a wonderful man who did a bad thing. He is a guy that loves the city of Covington and the people in the administration."

Police arrested Due on Aug. 23 and charged him with stealing city money. About a week later, Due was admitted to St. Elizabeth Edgewood after he was found in the garage of his home with the car running.

Then, on Sept. 10, emergency crews were called to Due's Independence home after he stabbed himself with a large knife. He was treated at University of Cincinnati Medical Center.

Sanders is recommending Due, who turns 64 on Sunday, be sentenced to 15 years in prison. Schneider is asking for a 10-year sentence. Whatever sentence is ultimately handed down, Due will have to serve 20 percent of it before being eligible for parole.

Judge Gregory Bartlett will announce the punishment April 17.

Due faced up to 40 years if he had gone to trial and been found guilty of all the charges. He was indicted on one count of abuse of public trust over $100,000, one count of theft by deception over $10,000, one count of unlawful access to a computer and 12 counts of second-degree criminal possession of a forged instrument.

In addition to the jail time, Due will also have to pay restitution to the city. The amount will be determined after the city's insurance company pays the city on its claims, Sanders said.

The city of Covington has filed a civil suit against Due in an attempt to collect the stolen money, but he appears to have few liquid assets. His Independence home, valued at about $250,000, is in foreclosure. Authorities described Due's vehicles as "basic nuts-and-bolts cars." Due's salary was $100,910 when he was fired.

Schneider said his client was exploring the possibility of turning over his retirement benefits to the city to help cover whatever restitution is ordered.

The embezzlement, dating back to August 2001, was caught last August when an employee who reported to him found a city-issued check made out to Due's wife.

Kentucky Auditor Adam Edelen's office was then called. Auditors reviewed more than 66,000 checks going back to February 1999, unveiling a scheme that allowed Due to write 68 checks to himself, his spouse, his aunt and a fake vendor totaling $793,127 from 2001 to 2013.

Due created two fake vendor names in the city's finance software, according to the auditor's report. It worked this way, the auditor said: To write a check, he would enter payment information using one of the two fictitious vendors or one of three legitimate city vendors and change the vendor name in the system to himself, his wife, his aunt or one of the fake vendors. He would then go into the office after hours, print the checks, delete the check history from the printer to avoid detection, change the name in the system back to the original vendor and deposit the checks into personal accounts he controlled.